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L8P 1J4

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Tag Archive: Group Benefits

  1. Three reasons why group benefits are so costly — and how you can address them

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    Group benefit costs continue to rise, but that’s not something you don’t already know. What you might not realize is why.

    Naturally, there are many varying reasons for general rate adjustments, and we don’t need to discuss the various justifications for why health and dental costs are on the rise. But it is worth reviewing the deeper-seeded components that factor in to plan costs — especially because, as an employer, you have some measure of control over these costs.

    Let’s take a look at three of them:

    Plan Design. This could be the greatest factor in why your costs are going up. If your plan is above industry norms, you will be attracting more claims from employees but also from their dependents, as under coordination of benefits (where a couple both have coverage), you will pay what other plans wouldn’t. Have you safeguarded against abuse and over-utilization in your plan? We are living in changing times, so if your group plan hasn’t changed, you are going to have more financial pressure than you can may be able afford. The changes we are talking about are not the typical benefit cutbacks, but rather a more forensic approach to benefit design that explores what your employees truly need. This type of review will reinforce the sustainability of your group plan.

    Claims Usage. The cost of your plan is directly correlated to claims paid. This requires us to focus on specific benefits, such as your health and dental, as these typically represent 60% of your total group benefit budget. And while this ties directly into the plan design you offer, it is also impacted by the mindset of your employees. Some employees will treat their group plan as an entitlement, with little regard for how the plan is used as it is company money, not their own. For this reason, engaging employees in the relationship between claims and costs and arming them with knowledge about why it is in their best interest to always be an aware consumer, even when it concerns their benefits, is critical to improving the results of your group plan. Corporate culture can have a significant bearing on your ability to partner with your employees and impact your bottom line.

    Carrier Costs. Have you noticed how complicated group benefits are getting? This confusion can frustrate employers and encourage rash decision-making over detailed analysis. However, a carrier’s costs can absolutely be an important factor in the group benefit cost conundrum, and avoiding it can quickly exacerbate the costs. Only through in-depth analysis by a group insurance expert/advisor can you confirm if you are paying too much for your plan. You can always market your group plan to test for competitiveness, but unless your advisor knows how the pricing of a plan works, you are likely boomeranging back to the same scenario, with a bad first renewal. So scrutiny of all the components of your plan’s costs is required to ensure you are obtaining real savings and can avoid the costly process of switching carriers cyclically.

    If you would like to explore the unique tools we use to address these key group benefit factors, please contact Steve Marsh at Business Insurance Services or 905.777.9990, ext. 200, today.

  2. Don’t have time to manage your benefits? Too busy doing other, more important things? Does it really matter to your bottom line?

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    We are living and working in fast times. With the technological revolution, it is no surprise that we often hear clients say that they just don’t have time to manage their benefits the way they would like to. Yet consider that group benefits cost an employer, on average, $3,500 per employee per year. With inflation this number is fast approaching $4,000 per employee per year, so maybe the question should be: How much are benefits affecting your bottom line?

    The real issue is how to find the time. This is where a trusted advisor can assist your organization. Someone who understands the group insurance business from the insurance carrier side, inside and out, and who can do the leg work that is required to ensure your plan is well designed, managed and negotiated, is key. Find a broker who will spend the time to analyze your group plan and understand your corporate culture and who is willing to invest the time needed to create the best group benefit solution for you and your employees.

    A seasoned group insurance advisor should understand how the insurance carrier/ industry and benefits work and be able to educate you and your employees by simplifying the information in written form, in person or via a multi-media format. We call this cutting through the benefit noise. Understanding group insurance doesn’t have to be complicated as long as a broker you trust is advocating for you and keeping watch over your numerous priorities in order to protect the interests of your organization.

    If you’d like to learn more about what we do for our clients and the creative ideas we implement to protect their plans, please contact Steve Marsh at smarsh@bisinc.ca or 905-777-9990, ext. 200.



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231 Main Street West, Main Floor
Hamilton, ON
L8P 1J4
Phone: (905) 777-9990
Email: rmarsh@bisinc.ca